Latin America: water catastrophe ahead

Strategic-culture.org reported that…..A NASA study measuring the Amazon rainforest canopy over the last decade found that droughts in 2005 and 2010 were severe enough to inhibit regrowth, portending deep ecological consequences if this cycle proceeds. (8) And researchers have registered an alarming retreat of the Andes glaciers in South America, by some 30-50 percent since the 1970s. They warn that millions of people will be at catastrophic risk from water shortage if and when the glaciers disappear. To the investment class, scarcity smells of profit, of course, and the profit opportunities where water is concerned could be huge. Until recently, the fact that states provided water to their citizens free of charge largely excluded water from the menu of investment projects. To be sure, investors took genuine interest in water processing technologies, like desalinization. But the idea of controlling access to water itself was not on the menu. The institutional landscape surrounding water is changing now, however, with potentially serious consequences in many areas of the globe. I expect to see a globally integrated market for fresh water within 25 to 30 years. Once the spot markets for water are integrated, futures markets and other derivative water-based financial instruments — puts, calls, swaps — both exchange-traded and OTC will follow. There will be different grades and types of fresh water, just the way we have light sweet and heavy sour crude oil today. Water as an asset class will, in my view, become eventually the single most important physical-commodity based asset class, dwarfing oil, copper, agricultural commodities and precious metals. Read Article